$Alphabet(GOOGL)$ $NVIDIA(NVDA)$ $Advanced Micro Devices(AMD)$ $Micron Technology(MU)$ There's a lot of hype around Moonshot's Kimi, but I think many overlook that these 'cost-efficient' models are often built through industrial-scale IP theft via knowledge distillation. It's a known ML technique where a smaller 'student' model learns from a larger 'teacher' model.
The process involves querying a powerful model, like Claude, at a massive scale with crafted prompts to capture reasoning traces, chain-of-thought, tool use, and outputs. That synthetic data is then used to train your own model, which is faster and cheaper than training from scratch.
Anthropic detailed these industrial-scale distillation campaigns in February 2026, involving DeepSeek, Moonshot AI (Kimi), and MiniMax. The figures were around 24,000 fraudulent accounts and 16 million exchanges with Claude, targeting areas like agentic reasoning, coding, tool use, and computer vision.
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